Rupee steady, starts at 70.50 vs dollar

The rupee on Monday opened flat at 70.50 against the dollar after industrial output growth dropped to a 17-month low of 0.5 per cent in November.

The local currency on Friday settled 8 paise down at 70.49.

Factory activity turned lacklustre on account of contraction in the manufacturing sector, particularly consumer and capital goods. Data showed IIP rose at a slower pace in November at 0.5 per cent as against a growth of 8.1 per cent in the previous month.

On the domestic front, market participants will be keeping an eye on the inflation print due later in the day.

“Expectation is that price rise could be slower in December compared to the previous month, thereby keeping the rupee supported on lower levels. Today, USD-INR pair is expected to quote in the range of 70.30 and 71.05,” brokerage Motilal Oswal Financial Services said.

The Reserve Bank remained net seller of dollars in November 2018 as it sold $644 million of the greenback on a net basis in the spot market, according to the latest data from the Central bank.

As against this, in November 2017, the central bank had purchased $2.57 billion from the spot market and sold $1.706 billion, while in the reporting month, the monetary authority bought $3.127 billion from the spot market, and sold $3.771 billion, the data showed.